Trademark Registration
Who Should Own the Trademark
Ahmedabad, Gujarat
A trademark application asks for a proprietor, and whoever you name there owns the mark. It is a one-line decision at filing that is expensive and slow to reverse later, and it is usually made without any thought at all.
Section 18(1) of the Trade Marks Act, 1999 allows any person claiming to be the proprietor of a mark to apply. That includes an individual, a company, an LLP, a partnership firm, a trust or a society. The Act does not tell you which one it should be. That is a commercial decision.
The three realistic options
The operating company. The entity that actually trades under the name. This is the default and it is usually right. The brand sits with the business that builds its value, the asset appears on that company’s balance sheet, and there is no licensing to arrange because owner and user are the same.
A founder personally. Common in early-stage businesses, and it has a genuine attraction: an individual applicant pays the concessional government fee. But it separates the brand from the business, which has consequences set out below.
A holding company. Standard where there are several operating entities, a franchise network or an intention to license the brand. The holding entity owns the mark and licenses it to the operators.
What goes wrong when the founder owns it
This is the most common arrangement and the one that causes the most trouble later.
If you sell the business, the buyer is buying a company that does not own its own brand. The trademark has to be assigned separately, which turns a clean share sale into a negotiation about an asset you hold personally. Buyers and their lawyers find this during due diligence, without exception.
If there are co-founders, a mark held by one of them personally is a live problem the moment the relationship changes. The company has no right to a name it has spent years building.
If investors come in, they will generally require the brand to be transferred into the company. An assignment at that point costs a government fee, takes time to record, and happens under deadline pressure.
None of these is fatal. All are avoidable by deciding correctly at filing.
If the owner is not the user, you need a licence
This is the technical point that catches people, and it matters more than most realise.
A registered trademark can be removed from the register for non-use under Section 47 if the proprietor has not genuinely used it. If a founder owns the mark but the company is the one trading, the proprietor is arguably not using it at all.
The answer is a licence. Under Section 48(2), use of a trademark by a permitted user is deemed to be use by the proprietor. So a written licence from the owner to the operating company protects the registration against a non-use attack, and also keeps quality control where it belongs.
The licence can be recorded with the Registry as a registered user on Form TM-U. Recordal is not compulsory for the arrangement to work, but it puts the position beyond argument.
Joint ownership: usually a bad idea
Two or more people can apply jointly, and co-founders often assume this is the fair option. In practice it tends to create problems rather than solve them.
Joint proprietors generally need to act together on the mark, which means assignment, licensing and enforcement all require agreement. If the founders later fall out, the mark can become unusable by either of them. A single owner with a clear licence to whoever needs to use it is almost always cleaner.
There is also a fee consequence: if any one joint applicant does not qualify for the concessional rate, the full fee applies to the whole application. See the guide to the MSME and startup fee concession.
Changing owner later
It is possible, just not free. Ownership is transferred by assignment, recorded with the Registry on Form TM-P, and the assignment itself should be in writing.
The practical costs are the government fee, the professional work in drafting and recording it, and the delay in the Registry processing the recordal. Until the change is recorded, the register still shows the old proprietor, which can complicate enforcement and due diligence.
A straightforward way to decide
Ask who will still be trading under this name in ten years. If the answer is the company, the company should own it.
Ask whether more than one entity will use the brand. If yes, a holding company with licences to each operator is the structure that scales.
Ask whether the concessional fee is genuinely driving the decision. If it is, weigh ₹4,500 per class against the cost of an assignment during a future transaction. It rarely survives that comparison.
One thing that is not an answer: registering the company and assuming the name is protected. It is not — see company name versus trademark. And before filing anything, check the name is clear using the public search guide.